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Tuesday, November 6, 2012

The Emperor Has No Gold!

For years I've felt like the little boy in that fable, where he sees that the Emperor has no clothes. Once I discovered Fractional Reserve Banking it all became crystal clear. Well it seems this move by Governments around the world to finally wake up and try to get their hands on their own gold is picking up steam.

Of course Chavez was ahead of the game, asking for Venezuela's back in 2011, but now there will be an almighty scramble by other countries to claim theirs, and for the Central Banks (principally London, New York, but also Paris) to try to promise to everyone that there is no panic and that they can all have a piece of the pie. They can't, it was rehypothecated years ago, and lies off-shore somewhere (Jersey? Cayman Islands? Switzerland? Phillippines?) and all we have is these paper certificates denoting ownership, kept safely in a leaky basement vault in New York.